Foreclosure of hotel won't affect tenants

Hotel Petaluma is still open for business and current tenants are still living in the historic hotel, but the building is under new management.

Union Bank of Marin County has foreclosed on the downtown hotel, and it is currently being managed by receiver Richard Sweeney of Preferred Realty Advisors of Southern California.

Court hearings on the foreclosure are scheduled for October and December.

The hotel, located on the corner of Washington and Kentucky streets, was purchased by Robert Miller, a Marin County investor and builder, for $6.1 million in 2007. How much he owes on the building is still unclear.

Miller has a successful history of purchasing and restoring historic buildings, including Petaluma's former school administration building on Fifth and B streets.

He initially made several improvements to the property, but acknowledged in a 2010 Argus-Courier story that he hadn't done as much as he would have liked.

"I would've liked to have done a lot more work on the hotel," he told the Argus-Courier, but the economy started to tumble. Maybe in year or two, when things improve, I can clean up the front, put up nice new awnings and uncover the row of windows that were stuccoed over."

The hotel has 104 rooms rented on a lease basis for between $550 and $750 a month. It also houses a pub, a nail salon, a tattoo parlor, a boutique and a record and vitamin shop.

Tenants were notified about the change in management by a written notice that indicated that there would be no changes in their current living situations.

Contacted residents had no comment on the change, although one, who asked to remain anonymous, did say he had "grievances" with the former owner.